Deutsche Bank Veteran Starts Institutional Bitcoin Exchange in Brazil

There’s no shortage of theories as to why Brazil has yet to become a hotbed of bitcoin adoption in Latin America.

Popular ideas include everything from the language barrier (limited access to Portuguese bitcoin resources) to past incidents with exchanges (the mystery surrounding Bitcoin Rain). However, the most likely culprit may be a lack of fundamentals in its market, according to one entrepreneur.

“The problem with liquidity in Brazil is we have natural buyers, we have people who want to trade, but we don’t have natural sellers,” explains Marcelo Miranda, a nine-year Deutsche Bank veteran who is launching a local bitcoin exchange, FlowBTC, on 6th March.

Miranda told CoinDesk:

“We don’t have mining, we don’t have a lot of merchants – these are natural sellers and hedgers.”

To alleviate these problems, Miranda has struck a partnership with bitcoin exchange software provider AlphaPoint that will connect FlowBTC to other exchanges around the world, including Canada’s Cointrader and Mexico’s meXBT.

AlphaPoint CEO Vadim Telyatnikov characterized the development as a positive one given Miranda’s background, and what he suggested was the untapped potential of Brazil’s market.

“We believe his expertise and experience trading securities, including on Deutsche Bank’s equity desk, will incentivize trading professionals to become more engaged in Latin America’s digital currency space,” Telyatnikov said.

Early interest

Miranda indicated that his interest in bitcoin began while he was working with Deutsche Bank, seeing it as an evolution of the growing influence of technology on trading activities.

“Trading in all markets became very high tech, so it was natural to me to look for something that was at the forefront of technology and trading, and for me bitcoin and digital currency was a perfect fit,” he explained.

The interest lead him to eventually part ways with the German bank. “They were restructuring and there was an opportunity to move on,” he said.

From there, he built IXBTC, a pricing index for the local market that launched last October, and began thinking of ways to bring his expertise more fully to the market.

“I started to realize, there was a lack of a professional grade exchange in Brazil,” Miranda said. “I think there was a big lack of an anchor exchange, some platform that institutional investors could relate to.”

“That was the whole idea behind FlowBTC,” he added, noting the team now includes five employees.

Miranda suggested that his former colleagues have been largely supportive of the move.

“It’s not that they think it’s something dumb or silly. I think that most of them can see the bright side of bitcoin and digital currency in general, I think they lack knowledge,” he said.

Focus on products

Tapping into this larger source of liquidity, Miranda said, will be just one of the competitive advantages for his endeavor.

FlowBTC aims to also focus on products, including a research report with market intelligence aimed at FX and equities traders.

Miranda indicated that FlowBTC considers itself a FinTech company, and that it plans to expand into payments more fully soon, entering a market served by competitors such as BitInvest, which has the highest-profile merchant partnership in Brazil to date.

Still, FlowBTC plans to evolve differently, citing more widely known institutional bitcoin platforms as companies with similar models.

“At some moment, when the Latin American market is mature enough, our idea is to become something closer to Coinsetter or LedgerX,” he added.

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.